We Are the World’s Richest 1%

Jan 5, 2012, 9:11 am EST

Some debated whether Wall Street — and not corporate headquarters or even the White House — was the best place to protest “the 1%.”

As it turns out, you could have plopped your picket sign down just about anywhere in the country and been fine.

World Bank economist Branko Milanovic took a look at the world’s richest people in his book The Haves and the Have-Nots, and at least as of the most recent data available (2005), almost half the richest 1% live in the United States. The threshold: $34,000 per person in a household. Translation: If you got a job out of college with anything better than a philosophy degree, you’re living the global dream. Read 

After Iowa: The Caucus Yields a Three-Way Tie

Jan 4, 2012, 11:39 am EST

The Republican Party is being pulled apart in three directions at once. Eventually, it will be up to voters to decide if this muddled mess provides America a real alternative to Barack Obama.

Although Mitt Romney technically won the Iowa contest last night, I agree with Ron Paul that the results were substantively a three-way tie. (Michelle Bachmann, who came in a distant sixth, announced that she’s ending her campaign.) Rick Santorum lost by a mere 8 votes, and Paul amassed an impressive third-place finish. In fact, Paul received double the number of votes he got four years ago, while Romney’s numbers didn’t budge.

The strange thing is, the policy differences between Romney, Santorum and Paul are so substantial that it’s hard to believe these top three candidates are even in the same party. Read 

Forget Iowa. New Jersey Should Vote First

Jan 3, 2012, 1:23 pm EST
Forget Iowa. New Jersey Should Vote First

Why Iowa? Though it’s too late for this year’s presidential race, I’d like to see a more representative state than Iowa as having the chance to winnow the field of presidential candidates. My adopted home state of New Jersey would be an ideal choice.

Forget the jokes about turnpike exits, The Sopranos or Snooki and The Jersey Shore. New Jersey is much more like the rest of America than Iowa is. Presidential candidates ignored the Garden State in 2008 because it’s seen as close to a sure thing for Democrats. New Jersey will probably be ignored this year for the same reason. That’s a pity because the state’s residents may be far more amenable to the Republicans’ message this year.

For one thing, Jersey is governed by Chris Christie, a Republican. Christie has shaken the state’s political establishment to its core. Though his abrasive personality has enraged many, Christie remains surprisingly popular, with 56% of residents approving of his job performance. Even so, Christie’s coattails didn’t translate into significant gains in the legislature for the Republicans. Read 

The Final Act of Debt Ceiling Drama 2011

Dec 30, 2011, 10:47 am EST

While the rest of us are recovering from the holidays and mulling over the best ways to spend our gift cards, the GOP hopefuls are making their final pleas to the citizens in Iowa and New Hampshire.

Just in case they have run out of campaign material, the debt ceiling compromise of summer 2011 is a gift that keeps on giving. President Barack Obama is expected to formally request to raise the debt ceiling again today. While this move should be no surprise, given the terms our dysfunctional Congress agreed to last summer, it will be greeted with political theatrics nonetheless.

While the obstinate Republican freshmen would love to vote against another debt ceiling increase, the timing of Obama’s request should deny them that pleasure. Congress will be allowed 15 days to vote on a resolution of disapproval, which could in turn be vetoed by the president. However, because neither the House nor the Senate are in session until Jan. 17, a resolution will not be introduced. Read 

10 Worst Countries for Tax Evasion

Dec 23, 2011, 8:00 am EST

From Washington, D.C., and Brasilia to Moscow and Madrid, the taxman is on a mission to squeeze more revenue from people, many of whom are struggling to make ends meet amid the worst economic slowdown since the Great Depression. He has his work cut out for him. That’s because tax evasion in all its many forms is so pervasive around the world.

How big a problem is tax evasion? Take a look at the table below from Tax Justice Network, a London-based watchdog that fights against tax havens. When combined with information from other academic, governmental and media sources, the full scope of tax evasion’s impact starts to become clear. And the results are surprising in a few ways. Top 10 Countries Losing to Tax Evasion Country GDP
($ MILLIONS) Size of
Economy (%) Tax burden
Overall (%) Tax lost as
a result of
shadow economy
($ Millions) U.S. 14,582,400 8.6% 26.9% 337,349 Brazil 2,087,890 39% 34.4% 280,111 Italy 2,051,412 27% 43.1% 238,723 Russia 1,479,819 43.8% 34.1% 221,023 Germany 3,309,669 16% 40.6% 214,996 France 2,650,002 15% 44.6% 171,264 Japan 5,497,813 11% 28.3% 171,147 China 5,878,629 12.7% 18% 134,385 U.K. 2,246,079 12.5% 38.9% 109,216 Spain 1,407,405 22.5% 33.9% 107,350 Source: Tax Justice Network

First, though politicians may disagree, the relationship between high tax rates and tax evasion isn’t so clear-cut. As David Cay Johnston of Reuters recently noted, “The United States has lower tax rates than eight of the nine other top 10 tax evasion countries [on Tax Justice Network’s list]. Rampant evasion in America raises doubts about the notion that high tax rates fuel evasion.” Indeed, countries with some of the lowest tax rates are among the most economically troubled, such as Ireland. Read 

Congress Ends 2011 Mired in Gridlock

Dec 22, 2011, 11:48 am EST

Happy Holidays from Congress’s failed supercommittee! The political pain we find ourselves in just days before Christmas was supposed to be alleviated by the bipartisan group appointed last summer to work out a large compromise on a variety of important fiscal policies: among them, the soon-to-expire payroll tax cut, extended unemployment benefits and the periodic Medicare “doc-fix.” When the supercommitte failed miserably right before Thanksgiving, they assured us of this current impasse.

The House of Representatives refuses to even vote on the bipartisan bill the Senate passed last week aimed at tackling those left-undone issues. The effects of this latest deadlock include slimmer paychecks for American workers in January, a cut-off in assistance for long-term unemployed and a 27% pay cut to Medicare providers.

But although the short-term pain will be immense, this could be a substantive turning point for the do-nothing Congress and Obama’s presidency. Read 

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